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Tuesday, 10 September 1996
Page: 3886


Mr CHARLES(9.15 p.m.) —I am delighted tonight to rise to address Appropriation Bill (No. 1), the budget. The budget brought down by the new Treasurer (Mr Costello) in the first Howard government is a fair budget. It is a fair budget and, as the Treasurer says, it addresses deficit and debt. The member for Corio (Mr O'Connor) is leaving in a great hurry. I sat here and listened to his contribution to this debate with, I must admit, some amazement and alacrity. The overblown hyperbole and the rhetoric was absolutely staggering. This was from a bloke who sat on this side of the House for 13 years while his political party was in government. He watched Treasurer after Treasurer come into this place and tell us how tomorrow would be full of nirvana. The world's problems were solved because the Treasurer had brought down another fantastic budget.

What happened? Here we are, 13 years later, saddled with incredible international debt, with a current account that continues to flow on and on in deficit, year after year. Debt builds upon debt. The member for Corio seems to think that we will achieve national significance, that we will achieve a better lifestyle for all Australians, if we continue to spend our children's pay cheques some time after the year 2000—perhaps even after the year 2010. It is long past the time that we should have got the household budget in order.

When the federal government spends Australians' hard earned income, we make an assumption that we can do it better than they can. What a lot of rot! Whoever told you that you knew how better to spend another bloke's money than that bloke knew how to spend it? It is an absolute nonsense.

I applaud the Expenditure Review Committee, the Prime Minister (Mr Howard), the Treasurer and the Minister for Finance (Mr Fahey) for doing the responsible thing in finally bringing down a budget that gives some hope to Australia. Despite the overblown rhetoric of the member for Corio, I have to say that the Australian public has warmed to this budget. They are happy with the budget because, finally, someone is taking the lead to address our overspending problem.

We hear a lot in this place about the current account. I am not sure that everybody in Australia knows what the current account deficit is. I doubt seriously that, if I talked to my two daughters and my son, they could tell me in technical terms what the current account deficit is. Here is just a little bit of layman's economics. There are two factors of the current account that affect us and that are relevant to the debate here tonight.

The first is savings. If, year after year, the government spends more than it gains in income, it cannot balance its budget. Do you know what happens then? Say you have got a Visa card, a Diner's Club card, an American Express card or a Bankcard. If you spend this month the total sum of your income next month, you will have difficulty eating, will you not? It is difficult to draw a cheque to find the money to meet the bills next month. So what do you do? You incur debt. That means that you have to pay interest. That is what is happening to us.

Part of the current account deficit problem is a savings problem. The Australian government is drawing on savings—private sector savings—it is eating up those savings, by irresponsibly running into debt. So half of our current account problem is due to the fact that we have to pay interest year after year on our borrowings, with expenditure being greater than the amount we have coming in.

The other half of the current account problem has to do with international trade. It was true for a very long time that Australia was a very wealthy country. For a long time we exported more than we imported. Those years were years where the international community was willing to pay relatively high prices for our commodities compared with the prices paid for manufactured goods or services. Unfortunately, Australia and other countries who are producers of primary commodities—whether they be minerals from the ground or agricultural commodities makes no differ ence—earn less today than they did 10 or 20 years ago relative to other items in the international traded economy.

In recent times, we have been able to increase our exports of manufactured goods. That has been very positive. But we still have this huge net trade deficit in the manufacturing sector, including industries which manufacture chemicals and plastics and petroleum products—process industries. You can only keep running those for so long, because you keep building up debt on debt on debt, and you have to pay the interest on the bill.

The solution to our problems is twofold. Firstly, we should not draw on Australia's savings; we should spend only the money which the government receives. That is what this budget sets out to do. Secondly, we should encourage industry to develop so that we sell more of our services, more of our manufactured goods and more of our process industry goods overseas. The budget also addresses this issue.

The first part of the savings issue is simple for most of us to understand. When the Treasurer brought down the budget, he was trying to put us in balance three years from now. The second part is the balance of trade. On this side of the House we are attempting to provide solutions to the trade imbalance problem through several mechanisms, the first of which is reform of our antiquated, archaic industrial relations laws, which has been part of the agenda on this side of the House since, really, 1984.

When I listen to the rhetoric of Bill Kelty and Jennie George of the ACTU, it reminds me of the overblown 1950s rhetoric of class division, warfare, deprivation, hardship and all those things that this government through this modest industrial relations `reform' or modernisation proposal is hoping to tackle. We need to bring Australia not just into the 20th century but into the 21st century, and that is what the workplace reform bill attempts.

We are trying to negotiate with the Australian Democrats in the Senate. It is hopeless trying to negotiate with the Australian Labor Party in the Senate; they have foreshadowed over 200 amendments—and the shadow minister for trade, the member for Canberra (Mr McMullan), is at the table now. Those over 200 amendments simply mean that the Labor Party is, once again, bidding the dictates of the ACTU in saying, `We oppose the bill—full stop. We oppose change.'

The Labor Party kept changing the industrial relations environment, it kept changing the regulations and it kept changing the 1988 bill. But now, all of a sudden, it cannot be changed any more. Paul Keating, in 1993 after he won the unwinnable election, the one he should not have won, went down to Melbourne on 21 April and gave a speech to the Institute of Company Directors. He said, amongst other things, `We have to modernise this system. We need to reduce this antiquated awards system from hundreds of thousands of provisions down to a few core, basic provisions, as a safety net, if you will, and let all the rest of the matters go to bargaining between companies and individuals or companies and their collective bargaining agents. We need to make it easier for people to work together to create solutions that are satisfactory to them, that do not treat all industry commonly.'

Commonality in terms of the Communist Party, in terms of socialism as a major agenda in eastern Europe, starting in the Soviet Union, flunked, didn't it? It did not work. Why? Because there were no incentives to drive it and because a few people at the top decided they knew better than everybody else. That is like going back to the beginning of my argument about this budget. Do you members of the Australian Labor Party who sit in this minute, insignificant, irrelevant opposition in this House of Representatives really think you know better than I do how to spend my money? I do not think so. And I do not think, deep at heart, you do either, but you have to keep running the line because you do not know what else to talk about.

You know you were deficient in not addressing the budget deficit problem a long time ago, after the recession we did not have to have—Paul Keating's recession we did not need. As we started coming out of that, the then Treasurer was very slow to move interest rates down to let the economy open up again. He forgot about the fact that perhaps he should start withdrawing some of the spending. The economy started to lift as productivity improved and the gross domestic product grew as we produced more, as we became more active and provided more jobs. But what did the government do? It spent more money quickly, as much and as fast as possible.

Talk about irresponsible: look at the lead-up to this most recent election. The then Minister for Employment, Education and Training was so paranoid about trying to artificially reduce the level of unemployment in Australia that he went out and spent a whole year's blessed budget in less than nine months on Working Nation. And the Working Nation programs, I can tell you, were bloated and overblown to begin with.

The Working Nation propositions simply said that we have a serious unemployment problem which we need to address, that we need to do something to bring down the numbers of long-term unemployed. Admirable sentiments. No disagreement from me ever. The long-term unemployed are some of the most disadvantaged people that we could have in this country.

But international studies have shown that spending heaps of taxpayers' money, heaps of public money on programs, programs, programs to advantage the people who are disadvantaged, does not work. Read the OECD studies. Read all of the international studies. It has never worked anywhere in the world. The only thing that has ever worked is if you go and pay employers to hire people. That works to some extent; but all the other stuff does not.

So the Working Nation budget was overblown to begin with. DEET was absolutely flush with money. Everywhere you went there was money for programs, initiatives or things you could tender on. It was so awash with money all over the place that it was an absolute embarrassment. And you expect us, knowing this from opposition, to sit here and continue to waste Australians' money in such a ridiculous fashion. I tell you what, there is no way known that I could be party to continuing such an absolute fraud on the Australian people.

So we intend to change the industrial relations environment. We intend to continue to let it evolve, to let it go down the path that the former Prime Minister indeed set as a pathway for Australia and one with which we never disagreed. So the things that you argue about in the Senate and the things about which we are now trying to convince the Independents and the Democrats are naturally progressive items in the reform of our workplace relations in Australia. They are simply aimed at letting employers and employees themselves decide things that affect their companies away from the central planning regime that never worked.

Another one of the catchcries of economists that we hear constantly in this place and which you read about in the press in Australia—I have never seen this in the press anywhere else in the world—is the concept of micro-economic reform. Do you know what that is, Madam Deputy Speaker Crosio? Of course you do. We all know what micro-economic reform means because we have had it stamped onto our foreheads. It is something like a branding iron which says, `Micro-economic—I'm for that.' Everybody is for it. How many people really know what it means?

It is a pretty simple concept. It simply means that we need to improve the efficiency of our utilities such as the electricity, natural gas and water supplies. We need to improve the efficiency of our transport industry—road transport, rail transport and air transport. We need to improve the efficiency of our waterfront and our coastal shipping operations.

Why do we need to improve these things? We are an island nation. We are down in the Pacific and we are dependent on the rest of the world. We are not really all alone down here. There are 18 million of us in this huge country. We are a wealthy nation, no fear. We are one of the most powerful nations on earth notwithstanding our very small population. Why? Because Australians have been willing to work hard—it is true that we are hard workers—because we are intelligent, because we believe in education, because we believe in fairness and equity and because we are one of the world's greatest democracies.

Democracy empowers the individual. Democracy gives the individual the chance to grow. It does, doesn't it? That is one reason it works. We have accepted onto our shores people from all over the world. I am an example of that. I accept that. I am a migrant. I took out Australian citizenship and became totally involved in this country. My heart, my soul, my life is now Australia. It no longer belongs to where I came from. I know that there is no-one in this place that would deny me my heritage or my birthright. I hope I have contributed to Australia. By the time I go to God, I would like to have helped to bring Australia part of the way back to its former glory. I hope to help—not do it on my own; no-one does anything on their own.

Australia is a great country with heaps of people and we can do so much for ourselves if we do not hold ourselves back. Part of not holding ourselves back is trying to hang on to the 1940s, 1950s and 1960s. This is 1996 and we are headed into 1997. We are not far away from the turn of the century and the world is moving so fast.

Did you read the front page of the Australian this morning? A young man, 23 years of age, has established a new business. According to reports, I believe he spent some two years trying to write a program to give people terrific access to the Internet. He did not do very well with that so he wrote one in 24 hours and it has been a world beater. It is so good that at the age of 23 he is going to float part of his company on the stock market to get capital to grow and to buy the hardware that he needs to give people access to this piece of software. It is selling all over the world like crazy.

What a success story. Talk about opportunity. We have heaps of opportunity, but you do not get that kind of opportunity under centralised control constraints. The party will tell you that you cannot do it. The member for Corio, who spoke in the debate before me, stood opposite and said that the government that he represented and was part of before we won the election in March used to spend money on these programs therefore we must keep spending it or it is unfair.

Why is it unfair? It is for one of two reasons. The first is that it continues to prop up this thing we call middle class welfare—that is, the government takes away from people in the middle income range money in the way of taxes. We say, `We want some of your money.' The Commissioner of Taxation demands that you give it to him. Those in the middle ground, the PAYE employees, frequently do not have a lot of opportunity to evade the net of the Commissioner of Taxation. They pay their taxes, he takes their money and then we in this place turn around and give it back to them. How stupid are we? I ask you: how dumb is that? We take their money and we decide how it should be spent and then we give it back. It seems like a dumb proposition to me.

All the Treasurer and the government have done in this budget is try to reduce spending. Why do we need to spend taxpayers' money? Why do we know better than they do how to spend their own earnings? (Time expired)